MEMORANDUM — CONFIDENTIAL / ATTORNEY WORK PRODUCT
TO: File — Matter No. 1043-00002
FROM: Douglas Fairchild, Partner, Real Estate Department
DATE: March 12, 2025
RE: New Matter Opening — Ironhaven Data Centers LLC — Stonebridge Data Center Campus Development ($600,000,000) — Loudoun County, Virginia
This memorandum is prepared as the internal matter opening memorandum for the above-referenced engagement. It sets forth the relevant client, project, and transaction information, the anticipated scope of engagement, the proposed engagement team, key milestones and timelines, identified parties and counterparties, conflict and ethical considerations, initial action items, and document management procedures. This memorandum is protected by the attorney work product doctrine and the attorney-client privilege. It is intended solely for internal use by Calderwood & Harkness LLP personnel assigned to or otherwise involved in Matter No. 1043-00002 and should not be distributed outside the firm without the prior approval of the undersigned.
1. Matter Information
Matter Number: 1043-00002
Client: Ironhaven Data Centers LLC ("IHDC")
Client EIN: 84-3291057
Virginia SCC Entity ID: S7491283
Client Address: 44680 Prentice Drive, Suite 200, Ashburn, VA 20147
Client Entity Type: Delaware limited liability company, headquartered in Ashburn, Virginia. IHDC was organized under the Delaware Limited Liability Company Act and is registered to transact business in the Commonwealth of Virginia as a foreign limited liability company.
Matter Description: Representation of Ironhaven Data Centers LLC in connection with the development of a $600,000,000 ground-up data center campus in Loudoun County, Virginia (the "Stonebridge Data Center Campus" or "Stonebridge Campus"), encompassing land assemblage of approximately 81.4 acres from two separate sellers, entitlement and permitting (including a Zoning Modification Application for data center use), EPC contract negotiation for a guaranteed maximum price construction agreement, power procurement agreements with the local cooperative utility, project-level construction financing through a senior secured construction loan facility, equity and sponsor documentation, entity formation and structuring, tax planning, insurance coordination, and the negotiation and documentation of easements and reciprocal agreements necessary for the development and operation of the campus.
Date Opened: March 12, 2025
Status: Active
Responsible Partner: Douglas Fairchild
Billing Partner: Angela Fontaine
Firm Office: Calderwood & Harkness LLP, 1900 K Street NW, Suite 800, Washington, DC 20006 (primary team location for this engagement). The firm's headquarters are located at 425 Lexington Avenue, New York, NY 10017. All substantive work on this matter will be performed primarily out of the Washington, DC office, with support from New York-based resources as needed.
Governing Law: Commonwealth of Virginia. The principal transactional documents — including the purchase and sale agreements, the construction loan documents, the EPC agreement, and the power procurement agreements — are expected to be governed by Virginia law, except to the extent that Delaware law governs the internal affairs of IHDC and certain affiliated entities organized in Delaware, and except as otherwise required by the applicable instrument or counterparty.
2. Client Background
Ironhaven Data Centers LLC ("IHDC") is a portfolio company operating at the intersection of the technology infrastructure and commercial real estate sectors, with a primary focus on the development, construction, and operation of carrier-neutral data center facilities in the Northern Virginia market — widely recognized as the largest data center market in the world by installed capacity. IHDC's business model centers on developing purpose-built, wholesale colocation data center facilities and leasing critical IT load capacity to hyperscale cloud providers, enterprise tenants, and managed service providers under long-term lease arrangements.
IHDC currently operates three existing data center facilities in Northern Virginia, located in Ashburn and Sterling, Virginia, totaling approximately 42 megawatts ("MW") of critical IT load. These facilities are substantially stabilized, with an aggregate occupancy rate exceeding 95% as of the date of this memorandum. The existing portfolio has established IHDC's reputation as a reliable operator in the Northern Virginia data center corridor and has provided the operational track record and tenant relationships that support the expansion contemplated by this engagement.
IHDC is now pursuing a significant campus expansion through the development of the Stonebridge Data Center Campus (the "Stonebridge Campus"), which is planned to add approximately 96 MW of additional critical IT load capacity across four buildings. Upon completion, the Stonebridge Campus will more than triple IHDC's existing operational capacity and will represent the company's single largest development undertaking to date.
Ownership Structure. The ownership structure of IHDC is as follows:
(a) Ridgeline Capital Partners Fund IV, LP ("Ridgeline Fund IV"), a Delaware limited partnership with approximately $3.8 billion in committed capital, holds a 92% equity interest in IHDC. This interest is held indirectly through an intermediate holding entity, RCP Digital Holdings LLC, a Delaware limited liability company that serves as the direct member of IHDC. RCP Digital Holdings LLC is wholly owned by Ridgeline Fund IV and was formed for the purpose of holding Ridgeline Fund IV's investment in IHDC and related digital infrastructure portfolio companies.
(b) Ridgeline Fund IV is managed by its general partner, Ridgeline Capital Management LLC, a Delaware limited liability company. Ridgeline Capital Management LLC serves as the investment adviser and manager of Ridgeline Fund IV and exercises all investment and disposition authority with respect to the fund's portfolio. The managing partner of Ridgeline Capital Management LLC who is relevant to this investment is Julian Hargrove. Mr. Hargrove leads Ridgeline's digital infrastructure and real assets investment vertical and will serve as the primary sponsor-level contact for matters relating to the Stonebridge Campus development.
(c) The remaining 8% membership interest in IHDC is held by IHDC management through a profits-interest vehicle, Ironhaven Management Incentive Pool LLC, a Delaware limited liability company. This entity holds carried interest and profits interests allocated to senior management of IHDC, subject to vesting schedules and distribution waterfalls set forth in the IHDC operating agreement. The management incentive pool is designed to align the interests of IHDC's operating team with those of the equity sponsor.
Key Client Contacts
The following individuals have been identified as the primary client contacts for purposes of this engagement:
• Marcus Thorne, Chief Executive Officer, Ironhaven Data Centers LLC — Mr. Thorne is the senior executive responsible for overall corporate strategy and will serve as the primary decision-maker on behalf of IHDC with respect to all material aspects of the Stonebridge Campus development.
• Priya Dasgupta, Chief Financial Officer, Ironhaven Data Centers LLC — Ms. Dasgupta oversees all financial matters, including capital structure, financing arrangements, tax planning, and budget management. She will be the primary contact for construction financing, equity contribution coordination, and tax matters.
• Leonard Castellano, Executive Vice President, Development, Ironhaven Data Centers LLC — Mr. Castellano leads IHDC's development function and will serve as the day-to-day project lead on the Stonebridge Campus. He will be the primary contact for land acquisition, entitlements, EPC contract negotiation, power procurement, and construction-related matters.
• Julian Hargrove, Managing Partner, Ridgeline Capital Management LLC — Mr. Hargrove is the equity sponsor contact. While our engagement is solely on behalf of IHDC (and not Ridgeline Fund IV), Mr. Hargrove will participate in key decision-making sessions and will need to approve certain material transactions, including the construction loan facility, the EPC contract, and the equity contribution agreement, consistent with Ridgeline Fund IV's governance rights under the IHDC operating agreement.
3. Project Overview
3.1 Project Description
Project Name: Stonebridge Data Center Campus ("Stonebridge Campus")
Location: The Stonebridge Campus will be situated at the intersection of Belmont Ridge Road and Stonebridge Boulevard, in unincorporated Loudoun County, Virginia 20148. The site is located within the established data center corridor in eastern Loudoun County, proximate to existing fiber routes, utility infrastructure, and transportation networks. The location benefits from Loudoun County's well-developed data center ecosystem, including access to multiple utility providers, fiber carriers, and a deep pool of experienced construction and operations personnel.
Total Project Budget: $600,000,000
Planned Capacity: 96 MW of critical IT load, to be delivered across four data center buildings designated as Buildings A, B, C, and D (each building designed to deliver 24 MW of critical IT load). The campus will be designed to support Tier III equivalent reliability standards, with N+1 redundancy on all critical mechanical and electrical systems within each building.
Total Campus Acreage: 81.4 acres, to be assembled from two parcels (the "Stonebridge Parcel" and the "Meridian Parcel," each as further described below).
Total Gross Floor Area: Approximately 480,000 square feet across four buildings, with each building comprising approximately 120,000 square feet. The buildings will include data halls, mechanical rooms, electrical rooms, loading docks, office and security areas, and ancillary support spaces.
Ridgeline Fund IV Investment ID: RCP-IV-2025-DC-07. This identifier is used internally by Ridgeline Capital Management LLC for portfolio tracking and reporting purposes. All references to the Stonebridge Campus investment within the Ridgeline Fund IV reporting framework should use this identifier.
3.2 Land Assemblage
The Stonebridge Campus will be developed on a combined site of approximately 81.4 acres, to be assembled from two parcels acquired from separate sellers in two distinct purchase transactions. The two parcels are adjacent and, when combined, will provide a contiguous development site of sufficient size and configuration to accommodate the planned four-building campus, associated parking, central utility plant, utility corridors, stormwater management facilities, and a dedicated electrical substation.
Stonebridge Parcel.
Acreage: 62.0 acres
Loudoun County Tax Map Reference: /95-4A-1///
Location: Northeast corner of Belmont Ridge Road and Stonebridge Boulevard, unincorporated Loudoun County, Virginia
Seller: Blackthorn Realty Group, Inc., a Virginia corporation. Blackthorn Realty Group is a regional land developer controlled by the Whitaker family. The President of Blackthorn Realty Group is Donald R. Whitaker. The company's General Counsel is Patricia Whitaker-Connolly.
Purchase Price: $58,500,000 ($943,548 per acre)
Seller's Counsel: Whitfield, Poole & Stratton LLP. The lead partner on this transaction for the seller is Harrison Poole. Whitfield, Poole & Stratton is a regional Virginia law firm with offices in Leesburg and Fairfax.
The Stonebridge Parcel constitutes the primary development site for the campus and will accommodate Buildings A through D, the central utility plant, the primary vehicular access drives, parking areas, and the bulk of the campus stormwater management infrastructure. The parcel is currently undeveloped but has a history of prior agricultural use, which gives rise to a known environmental issue discussed further below in connection with the scope of environmental due diligence.
Meridian Parcel.
Acreage: 19.4 acres
Loudoun County Tax Map Reference: /95-4A-2///
Location: Adjacent to the Stonebridge Parcel on the east
Seller: Meridian Acres LLC, a Virginia limited liability company, managed by Theodore Ashford.
Purchase Price: $19,400,000 ($1,000,000 per acre)
Seller's Counsel: Dunleavy & Dunmore Benefits Consulting, PLLC. The lead attorney on this transaction for the seller is Fiona Dunleavy.
The Meridian Parcel is needed for utility routing, a dedicated substation easement for the Vantage Power Cooperative electrical substation, and additional building pads. The Meridian Parcel provides critical frontage and access for the high-voltage power feed that will serve the campus and is essential for the overall project design and utility interconnection plan. Without the Meridian Parcel, the campus would lack sufficient area for the substation and utility corridor, which would materially impair the project's feasibility and timeline.
Summary. Total Land Cost: $77,900,000 (combined purchase price for both parcels)
Existing Zoning: Both parcels are currently zoned PD-IP (Planned Development – Industrial Park) under the Loudoun County Zoning Ordinance. While the PD-IP zoning classification permits a range of industrial and technology uses, data center use specifically requires a Zoning Modification Application ("ZMOD") under the current provisions of the Loudoun County Zoning Ordinance. The ZMOD process and anticipated timeline are addressed in Section 4.3 below.
3.3 Project Budget Summary
The total project budget of $600,000,000 is summarized by category as follows:
The budget has been reviewed and approved by IHDC management and Ridgeline Capital Management LLC. The contingency and reserves allocation of $34,900,000 represents approximately 5.8% of the total project budget, which is consistent with market practice for ground-up data center development projects of this scale. The EPC hard costs are based on preliminary discussions with Titan-McAllister Construction Group, LLC, and are expected to be refined through the GMP negotiation process described in Section 4.4 below.
3.4 Capital Stack
The anticipated capital structure for the Stonebridge Campus development is as follows:
The 65% loan-to-cost ratio is consistent with the maximum leverage parameters that have been discussed with Summit National Bank, N.A. in preliminary conversations regarding the construction loan facility. The equity component of $210,000,000 will be funded by Ridgeline Fund IV through IHDC pursuant to an equity contribution agreement to be negotiated and documented as part of this engagement. A minimum equity contribution of $52,500,000 (representing 25% of the total $210,000,000 equity commitment) will be required prior to the first draw under the construction loan facility, consistent with the anticipated lender requirements.
4. Scope of Engagement
The following sections describe the anticipated scope of Calderwood & Harkness LLP's engagement on behalf of IHDC in connection with the Stonebridge Campus development. The scope may be expanded or modified as the transaction progresses, subject to mutual agreement with the client and appropriate adjustments to staffing and budgets.
4.1 Land Acquisition
Calderwood & Harkness will represent IHDC in connection with the acquisition of both the Stonebridge Parcel and the Meridian Parcel. The land acquisition workstream will include the following:
(a) Purchase and Sale Agreements. Negotiate and document purchase and sale agreements ("PSAs") for both the Stonebridge Parcel and the Meridian Parcel. With respect to the Stonebridge Parcel, seller's counsel (Whitfield, Poole & Stratton LLP; lead partner: Harrison Poole) has circulated an initial draft PSA, which the firm will review, mark up, and negotiate. With respect to the Meridian Parcel, the firm will either prepare the initial draft PSA or respond to a seller's draft, depending on the approach agreed upon with Meridian Acres LLC and its counsel (Dunleavy & Dunmore Benefits Consulting, PLLC; lead attorney: Fiona Dunleavy). Each PSA is expected to include customary provisions for feasibility study periods, due diligence contingencies, title and survey objection procedures, deposit escrow arrangements, seller representations and warranties regarding environmental condition and zoning, prorations, and closing conditions.
(b) Title Examination and Survey Review. Coordinate title examination and survey review through Fidelitas Title & Escrow, Inc., which will serve as the title agent and escrow agent for both transactions. The title underwriter will be Sovereign Title Insurance Company. The firm will review title commitments for each parcel, identify and resolve title exceptions and encumbrances, negotiate title endorsements required by IHDC and the construction lender, and coordinate the issuance of owner's and lender's title insurance policies at closing.
(c) Environmental Due Diligence. Oversee environmental due diligence, including Phase I Environmental Site Assessments ("Phase I ESAs") for both parcels and a Phase II Environmental Site Assessment ("Phase II ESA") for the Stonebridge Parcel. Environmental investigations will be conducted by Pendleton Environmental Associates, Inc. (lead consultant: Dr. Renata Volkov). A known environmental issue has been identified with respect to the Stonebridge Parcel: the parcel has a history of former agricultural use, and there is potential residual pesticide contamination in the northwest quadrant of the parcel, encompassing approximately 4.2 acres. The Phase II ESA will be conducted to delineate the nature and extent of any such contamination and to evaluate the need for remediation, a voluntary remediation plan, or other risk management measures. The results of the Phase II ESA may affect the allocation of environmental liability under the Stonebridge PSA, including indemnification provisions, remediation escrows, and potential environmental insurance procurement.
(d) Geotechnical Investigation. Coordinate the geotechnical investigation to be conducted by Brannigan Geotechnical Engineering, LLC (lead: Neil Brannigan, PE). The geotechnical report will inform foundation design, site grading plans, and earthwork cost estimates within the EPC budget.
(e) ALTA Surveys. Coordinate the preparation and review of ALTA/NSPS Land Title Surveys for both parcels by Lumen Ridge Engineering, PLLC (lead: Carlos Esteban, PE). The ALTA surveys will be prepared in accordance with the 2021 Minimum Standard Detail Requirements for ALTA/NSPS Land Title Surveys and will include Table A items as required by the title company, the construction lender, and the firm.
(f) MAI Appraisals. Coordinate the preparation of MAI appraisals for both parcels by Greystone Appraisal Partners, LLC (lead appraiser: Janet Choi, MAI). The appraisals will be required by the construction lender and will also inform the equity sponsor's internal valuation and underwriting.
(g) Assignment and Assumption of PSAs. Prepare documentation for the assignment and assumption of each PSA from IHDC to the single-purpose borrower entity, Stonebridge Campus Holdings LLC, prior to or concurrently with the closing of the land acquisitions. This assignment is necessary so that title to the parcels vests directly in the borrower entity, which will serve as the fee owner and the borrower under the construction loan facility.
(h) Closing Documents. Draft closing documents for both land acquisitions, including special warranty deeds (grantor to convey by special warranty deed in accordance with Virginia law), settlement statements, transfer tax declarations, FIRPTA certificates, and all other documents customary for commercial real estate closings in the Commonwealth of Virginia. The escrow agent for both transactions will be Fidelitas Title & Escrow, Inc.
4.2 Entity Formation
Calderwood & Harkness will handle the formation and organizational documentation of the single-purpose entity to be used as the borrower under the construction loan facility and the fee owner of the Stonebridge Campus property. Specifically:
(a) Formation of Stonebridge Campus Holdings LLC. Stonebridge Campus Holdings LLC will be formed as a Virginia limited liability company, wholly owned by IHDC. Articles of organization will be prepared and filed with the Virginia State Corporation Commission. The entity will be structured as a single-purpose entity ("SPE") in accordance with the requirements of the construction lender and customary market practice for project-level real estate financing.
(b) Operating Agreement. The firm will prepare the operating agreement for Stonebridge Campus Holdings LLC, which will include single-purpose entity covenants (including, without limitation, restrictions on incurrence of additional indebtedness, restrictions on mergers and consolidations, separateness covenants, requirements for independent directors or managers, and restrictions on voluntary bankruptcy filings), consistent with the requirements anticipated by Summit National Bank, N.A. and the lending syndicate.
(c) Organizational Resolutions. The firm will prepare organizational resolutions for Stonebridge Campus Holdings LLC authorizing the entity to enter into the construction loan, the land acquisitions, the EPC agreement, the power procurement agreements, and all related transactions.
(d) Secretary's Certificate and Incumbency. The firm will prepare a secretary's certificate and incumbency documentation for IHDC, confirming the authorization of IHDC to cause the formation of Stonebridge Campus Holdings LLC and to enter into the transactions contemplated by this engagement.
4.3 Entitlements and Zoning
Calderwood & Harkness will coordinate and oversee the entitlements process for the Stonebridge Campus, working in conjunction with local zoning counsel and land use consultants. The entitlements workstream will include the following:
(a) ZMOD Application. Preparation, review, and filing of a Zoning Modification Application ("ZMOD") for data center use on the combined campus site. The ZMOD application is expected to be assigned docket number ZMOD-2025-0038. The application must be filed with the Loudoun County Department of Planning and Zoning and is targeted for filing by May 30, 2025. The ZMOD application is necessary because, while the existing PD-IP zoning classification permits industrial park uses, data center use specifically requires a zoning modification under the current provisions of the Loudoun County Zoning Ordinance.
(b) Proffer Negotiation. Negotiate the terms and amount of proffers with the Loudoun County Board of Supervisors. Based on current Loudoun County proffer guidelines and recent precedent for data center developments of comparable scale, the estimated proffer amount is approximately $2,400,000, calculated at $5.00 per square foot of gross floor area multiplied by 480,000 square feet of total GFA. Proffers may include cash contributions, transportation improvements, environmental mitigation, community amenities, or other conditions as may be negotiated with the Board.
(c) Local Zoning Counsel. Calderwood & Harkness will coordinate with Ashcroft & Wynn, P.C. (lead attorney: Thomas Ashcroft), which will serve as local zoning counsel for the ZMOD application and proffer negotiations. Ashcroft & Wynn has extensive experience with data center entitlements in Loudoun County and will handle the day-to-day interactions with the Loudoun County Department of Planning and Zoning, the Planning Commission, and the Board of Supervisors.
(d) Land Use Consultant. Calderwood & Harkness will also coordinate with Cornerstone Land Use Consulting, LLC (lead consultant: Alan Mercer), which will provide land use planning and community engagement support for the ZMOD application process.
(e) Target Approval. The target date for ZMOD approval by the Loudoun County Board of Supervisors is the October 2025 hearing cycle. This timeline is aggressive but achievable based on recent processing timelines for comparable applications in Loudoun County, provided that the application is filed on schedule and no material objections or community opposition issues arise.
4.4 EPC Contract
Calderwood & Harkness will negotiate and document the engineering, procurement, and construction ("EPC") agreement for the Stonebridge Campus. The EPC contract workstream will include the following:
(a) EPC Contractor. The EPC agreement will be negotiated with Titan-McAllister Construction Group, LLC, a Maryland limited liability company. Titan-McAllister is a national data center construction firm with significant experience in the Northern Virginia market. The President of Titan-McAllister is Raymond Okafor. The Senior Vice President, Data Center Programs, is Michelle Tran, who will serve as the primary Titan-McAllister contact for the Stonebridge Campus project.
(b) Contract Structure. The EPC agreement will be structured as a guaranteed maximum price ("GMP") contract. The GMP is $412,000,000, covering the construction of four data center buildings (Buildings A through D), a central utility plant serving the entire campus, and all site civil work, including grading, paving, utility infrastructure, landscaping, and stormwater management facilities.
(c) Key Terms. The following key commercial terms are anticipated for the EPC agreement:
• Construction Duration: 24 months from issuance of the Notice to Proceed ("NTP").
• Liquidated Damages: $125,000 per calendar day per building for delays beyond the scheduled substantial completion date, capped at 10% of the per-building GMP (approximately $10,300,000 per building, based on a per-building GMP of approximately $103,000,000).
• Retainage: 10% retainage on all progress payments until 50% completion of the work, reducing to 5% retainage thereafter, with final retainage released upon completion of punch list items and issuance of the certificate of occupancy.
• Change of Control Provisions: The EPC agreement will include change of control provisions restricting assignment or transfer of the contractor's interest without the owner's consent, and providing for owner termination rights in the event of a change of control of the contractor.
(d) Performance and Payment Bonds. Review performance bonds and payment bonds to be issued in connection with the EPC agreement. Each bond is to be in an amount equal to 100% of the GMP ($412,000,000 each). The bonds will be issued by Great Basin Surety & Insurance Corp. The firm will review the bond forms, ensure compliance with Virginia statutory requirements for payment bonds (where applicable), and confirm that the bonds are acceptable to the construction lender.
(e) Owner's Representative. Calderwood & Harkness will coordinate with Kestrel Infrastructure Advisors, LLC (lead: Diane Prescott), which will serve as the owner's representative for the construction phase. Kestrel will be responsible for construction oversight, progress monitoring, draw request review, and quality assurance on behalf of IHDC and the construction lender.
4.5 Power Procurement
Calderwood & Harkness will negotiate and document the power procurement agreements necessary to supply electrical power to the Stonebridge Campus. The power procurement workstream will include the following:
(a) Large Load Service Agreement. Negotiate a Large Load Service Agreement with Vantage Power Cooperative ("VPC") for 120 MVA of contracted demand to serve the Stonebridge Campus. The Large Load Service Agreement is expected to have a term of 10 years. The demand charge is $8.42 per kW per month for years 1 through 5 of the term, escalating at 2.5% annually thereafter. VPC has assigned Service Application No. LSA-2025-0091 to this request. The agreement will address demand charges, energy charges, power factor requirements, service reliability standards, force majeure provisions, and termination rights.
(b) Line Extension Funding Agreement. Negotiate a line extension funding agreement with VPC, pursuant to which IHDC will contribute $18,500,000 to fund the construction of the high-voltage transmission and distribution infrastructure necessary to serve the campus. This contribution covers the extension of 230kV transmission lines, the construction of a dedicated 230kV/34.5kV substation on the Meridian Parcel, and associated switchgear and interconnection facilities. The funding agreement will address the schedule and milestones for construction, refund provisions (if any), ownership and maintenance responsibilities post-energization, and VPC's obligation to deliver power by the contracted delivery date.
(c) Substation Easement. Negotiate and document a substation easement on the Meridian Parcel in favor of VPC for the dedicated 230kV/34.5kV substation. The substation will be owned by VPC upon completion of construction. The easement will grant VPC the right to construct, operate, maintain, repair, and replace the substation and associated facilities on a defined area of the Meridian Parcel. The easement terms will address access rights, indemnification, insurance requirements, relocation obligations, and co-termination provisions.
4.6 Construction Financing
Calderwood & Harkness will represent IHDC and the borrower (Stonebridge Campus Holdings LLC) in connection with the negotiation and documentation of a $390,000,000 senior secured construction loan facility. The construction financing workstream will include the following:
(a) Lending Syndicate. The construction loan facility will be provided by a three-lender syndicate consisting of:
• Summit National Bank, N.A. — Administrative Agent, with a $180,000,000 commitment. The lead contact at Summit is Karen Ellsworth, Managing Director, Real Estate Finance. Summit Loan Commitment Reference: CL-2025-VA-04418.
• Cascade Commercial Lending Corp. — Participating Lender, with a $130,000,000 commitment. The lead contact at Cascade is David Rennick.
• Harborview Trust Company — Participating Lender, with an $80,000,000 commitment. The lead contact at Harborview is Susan Applegategate.
(b) Key Economic Terms. The following key economic terms are anticipated for the construction loan facility:
• Interest Rate: Term SOFR plus 285 basis points, with a 0.50% SOFR floor.
• Unused Commitment Fee: 0.50% per annum on undrawn commitments.
• Arrangement Fee: 1.00% of the total facility amount ($3,900,000), payable at closing.
• Draw Period: 36 months from the closing date of the construction loan.
• Maturity: 48 months from the closing date, with one 12-month extension option (subject to satisfaction of extension conditions, including payment of an extension fee and satisfaction of financial covenants).
• Loan-to-Cost Ratio: Maximum LTC of 65.0%.
• Debt Service Coverage Ratio: Minimum DSCR of 1.25x at stabilization (to be tested in connection with any extension or conversion, if applicable).
• Minimum Equity Contribution: A minimum equity contribution of $52,500,000 (representing 25% of the total $210,000,000 equity commitment) must be funded and invested in the project before the first draw under the construction loan facility.
(c) Borrower and Guarantor.
• Borrower: Stonebridge Campus Holdings LLC, a to-be-formed single-purpose Virginia limited liability company, wholly owned by IHDC.
• Guarantor: Ironhaven Data Centers LLC. IHDC will provide a completion guaranty (guaranteeing lien-free completion of the project in accordance with the approved plans and specifications and the EPC agreement) and a carry guaranty (guaranteeing payment of interest, taxes, insurance, and other carrying costs during the construction period).
(d) Collateral Package. The construction loan will be secured by the following collateral:
• First-priority deed of trust encumbering the Stonebridge Campus property (both the Stonebridge Parcel and the Meridian Parcel), to be recorded in the Loudoun County Circuit Court Clerk's Office.
• Assignment of leases and rents with respect to any pre-leasing or tenant commitments obtained during the construction period.
• Pledge of 100% of the membership interests in Stonebridge Campus Holdings LLC (the borrower).
• Assignment of the EPC agreement, architect agreements, and all other construction-related contracts.
• Assignment of permits, licenses, approvals, and entitlements, including the ZMOD approval and the Large Load Service Agreement with VPC.
(e) Change of Control. The construction loan agreement will include a change of control mandatory prepayment trigger: if Ridgeline Fund IV ceases to hold, directly or indirectly, at least 51% of the equity interests in the borrower or the guarantor, the lenders will have the right to declare a mandatory prepayment event and accelerate the outstanding loan balance.
(f) Lender's Counsel. The lender's counsel is Redmond & Calloway LLP (lead partner: Victor Redmond). Redmond & Calloway's offices are located at 8300 Greensboro Drive, Suite 1100, McLean, VA 22102. The firm will coordinate with Redmond & Calloway throughout the negotiation and documentation process and will work to resolve open issues in a manner consistent with IHDC's interests and market-standard construction lending practices.
(g) Legal Opinion. Calderwood & Harkness will deliver a legal opinion letter to the lenders at the closing of the construction loan facility. The opinion is expected to address the due organization and good standing of the borrower and guarantor, the authorization and enforceability of the loan documents, the perfection of the collateral, and such other matters as may be required by the lenders or lender's counsel.
4.7 Equity / Sponsor Documentation
Calderwood & Harkness will prepare and negotiate the equity and sponsor documentation necessary to support the capital structure of the Stonebridge Campus development. This workstream will include the following:
(a) Equity Contribution Agreement. Prepare and negotiate an Equity Contribution Agreement between Ridgeline Fund IV (acting through RCP Digital Holdings LLC) and IHDC, pursuant to which Ridgeline Fund IV will commit to fund $210,000,000 in equity contributions to IHDC for investment in the Stonebridge Campus through Stonebridge Campus Holdings LLC. The Equity Contribution Agreement will address the schedule and conditions for equity funding, including the minimum pre-draw equity contribution of $52,500,000 required by the construction lender, as well as representations, warranties, and remedies for failure to fund.
(b) Side Letter. Prepare a side letter containing representations and covenants for the benefit of the construction lender, including representations regarding the equity commitment, the financial condition of the equity sponsor, and covenants regarding the maintenance of the equity commitment throughout the construction period. The side letter will be negotiated in conjunction with the construction loan documentation and will be delivered to the lender at the construction loan closing.
(c) Member Consent Resolutions. Prepare member consent resolutions of IHDC (and, to the extent required, of RCP Digital Holdings LLC and Ridgeline Fund IV) authorizing all transactions contemplated by this engagement, including the land acquisitions, the formation of Stonebridge Campus Holdings LLC, the equity contribution, the construction loan, the EPC agreement, and the power procurement agreements.
4.8 Tax Matters
Calderwood & Harkness's tax group, working in coordination with the real estate team, will advise IHDC on the following tax matters in connection with the Stonebridge Campus development:
(a) Virginia Data Center Sales and Use Tax Exemption. Analysis of IHDC's qualification for the Virginia data center sales and use tax exemption under Virginia Code § 58.1-609.3(18). To qualify for this exemption, the project must satisfy certain statutory thresholds, including a minimum capital investment of $150,000,000 over a five-year period and the creation of a minimum of 50 new jobs. The Stonebridge Campus is expected to comfortably exceed both thresholds. The estimated tax savings from the exemption are approximately $15,900,000, based on the application of the Virginia combined state and local sales and use tax rate of 5.3% to approximately $300,000,000 in eligible equipment purchases (including servers, power distribution units, cooling systems, generators, UPS systems, and other qualifying data center equipment).
(b) Entity Structure and Tax Election Recommendations. The tax team will evaluate the optimal entity structure and federal and state tax elections for IHDC and Stonebridge Campus Holdings LLC, including analysis of the treatment of the entities as disregarded entities or partnerships for federal income tax purposes, and the implications of such elections for the equity sponsor and management incentive pool.
(c) Cost Segregation Study. The tax team will recommend and coordinate a cost segregation study for the Stonebridge Campus. Based on preliminary analysis and comparable studies for similar data center developments, it is estimated that approximately $45,000,000 in construction costs may be reclassifiable from real property (39-year MACRS life) to personal property or land improvements (5-year, 7-year, or 15-year MACRS lives), resulting in accelerated depreciation deductions and significant present-value tax benefits for the equity investors.
(d) Loudoun County Equipment Tax. Analysis of Loudoun County's business tangible personal property (equipment) tax, which is levied at a rate of $1.25 per $100 of assessed value. This tax applies to data center equipment and is a significant ongoing operating cost. The tax team will evaluate the assessment methodology, potential exemptions or abatements, and strategies for minimizing the equipment tax burden.
(e) Coordination with Outside Tax Advisors. The tax team will coordinate with Fielding & Associates, CPAs, which serves as IHDC's outside accounting and tax compliance firm, on all tax-related matters arising from the Stonebridge Campus development.
4.9 Insurance. Calderwood & Harkness will coordinate with IHDC's insurance broker and advise on the insurance program for the Stonebridge Campus development. This workstream will include the following:
(a) Insurance Broker. Coordination with Northgate Insurance Brokerage, LLC (lead: William Keane), which serves as IHDC's insurance broker and will be responsible for procuring the insurance coverages described below.
(b) Builder's Risk Insurance. Builder's risk insurance in an amount of $412,000,000 (equal to the GMP under the EPC agreement), to be underwritten by Great Basin Surety & Insurance Corp., with a deductible of $250,000 per occurrence. The builder's risk policy will cover the Stonebridge Campus during the construction period against risks including fire, windstorm, flood, earthquake, theft, vandalism, and other perils customarily covered in builder's risk policies for projects of this type and scale.
(c) OCIP Evaluation. Evaluation of an Owner-Controlled Insurance Program ("OCIP") as an alternative to traditional contractor-procured insurance during the construction phase. Based on preliminary analysis, an OCIP is estimated to produce savings of 12% to 15% compared to traditional insurance costs. The firm will advise on the legal and contractual implications of implementing an OCIP, including the impact on the EPC agreement, subcontractor agreements, and the construction loan requirements.
(d) Directors and Officers Liability Insurance. D&O liability insurance with a $10,000,000 limit, to be underwritten by Clearwater Specialty Underwriters, Inc. This coverage will protect the officers and managers of IHDC and Stonebridge Campus Holdings LLC against claims arising from their management of the Stonebridge Campus development.
(e) Post-COO Operational Property Insurance. Upon issuance of the certificates of occupancy for the Stonebridge Campus buildings, IHDC will procure operational property insurance with a target replacement cost value of $600,000,000. The firm will advise on the scope and structure of this coverage in coordination with the insurance broker and the construction lender.
(f) Cross-Reference of Insurance Requirements. Calderwood & Harkness will undertake a cross-reference analysis of the insurance requirements set forth in the EPC Agreement and the Construction Loan Agreement to ensure consistency and compliance with both sets of requirements. Any conflicts or gaps between the insurance programs required by the EPC contractor and the construction lender will be identified and resolved.
4.10 Easements and Reciprocal Agreements
Calderwood & Harkness will negotiate and draft the easement and reciprocal agreements necessary for the development and operation of the Stonebridge Campus. This workstream will include the following:
(a) Cross-Access and Utility Easement Agreement. A cross-access and utility easement agreement between the Stonebridge Parcel and the Meridian Parcel, establishing reciprocal rights of vehicular and pedestrian access across both parcels and granting utility easements for water, sewer, stormwater, electrical, fiber optic, and telecommunications infrastructure crossing parcel boundaries. This agreement is essential to the integrated operation of the campus as a single development, notwithstanding the separate acquisition of the two parcels.
(b) Stormwater Management Facility Easement and Maintenance Agreement. A stormwater management facility easement and maintenance agreement establishing the location, configuration, and maintenance responsibilities for shared stormwater management facilities serving the campus. The stormwater management facilities are expected to include detention basins, bioretention areas, and conveyance infrastructure, as required by Loudoun County stormwater management regulations and the Virginia Department of Environmental Quality.
(c) Substation Easement. A substation easement in favor of Vantage Power Cooperative on the Meridian Parcel for the dedicated 230kV/34.5kV substation, as described in Section 4.5(c) above. This easement will be negotiated in conjunction with the Line Extension Funding Agreement and the Large Load Service Agreement.
5. Key Milestones and Timeline
The following table sets forth the key milestones and target dates for the Stonebridge Campus development. These dates are based on current estimates and may be adjusted as the transaction progresses. The engagement team will maintain a detailed project schedule and will update these milestones as necessary.
The overall project timeline contemplates approximately 24 months of construction activity from NTP to substantial completion of all four buildings, consistent with the construction duration specified in the anticipated EPC agreement. The stabilization target of 85% leased critical IT load by Q2 2028 is based on IHDC's pre-leasing pipeline and current market demand for wholesale colocation capacity in the Northern Virginia market.
6. Engagement Team
The following attorneys have been assigned to Matter No. 1043-00002. The table below identifies each team member, their role, and their primary workstream responsibilities.
Additional associates and support staff may be added to the engagement team as workstreams intensify, particularly during the construction loan documentation phase and the closing process. Any additions to the team will be approved by the responsible partner and communicated to the client.
7. Identified Parties and Counterparties
The following is a comprehensive listing of all parties and counterparties identified in connection with the Stonebridge Campus development as of the date of this memorandum. This listing is provided for reference purposes and to support the firm's conflict checking and matter management functions.
Client and Affiliated Entities
• Ironhaven Data Centers LLC ("IHDC") — Client
• Ridgeline Capital Partners Fund IV, LP ("Ridgeline Fund IV") — Equity sponsor (92% indirect owner of IHDC)
• RCP Digital Holdings LLC — Intermediate holding company (direct member of IHDC; wholly owned by Ridgeline Fund IV)
• Ridgeline Capital Management LLC — General partner and manager of Ridgeline Fund IV
• Ironhaven Management Incentive Pool LLC — Management profits-interest vehicle (8% membership interest in IHDC)
• Stonebridge Campus Holdings LLC (to be formed) — Single-purpose borrower entity (to be wholly owned by IHDC)
Sellers.
• Blackthorn Realty Group, Inc. — Seller of the Stonebridge Parcel (Donald R. Whitaker, President; Patricia Whitaker-Connolly, General Counsel)
• Meridian Acres LLC — Seller of the Meridian Parcel (Theodore Ashford, Manager)
EPC Contractor.
• Titan-McAllister Construction Group, LLC — EPC contractor (Raymond Okafor, President; Michelle Tran, SVP Data Center Programs)
Lenders.
• Summit National Bank, N.A. — Administrative Agent ($180,000,000 commitment; Karen Ellsworth, Managing Director)
• Cascade Commercial Lending Corp. — Participating Lender ($130,000,000 commitment; David Rennick)
• Harborview Trust Company — Participating Lender ($80,000,000 commitment; Susan Applegategate)
Utility Provider.
• Vantage Power Cooperative ("VPC") — Electric utility provider (Large Load Service Agreement, line extension, substation)
Title Company and Underwriter
• Fidelitas Title & Escrow, Inc. — Title agent and escrow agent
• Sovereign Title Insurance Company — Title underwriter
Insurance Carriers.
• Great Basin Surety & Insurance Corp. — Builder's risk insurance; performance and payment bonds
• Clearwater Specialty Underwriters, Inc. — Directors and officers liability insurance
Consultants.
• Cornerstone Land Use Consulting, LLC (Alan Mercer) — Land use consultant
• Pendleton Environmental Associates, Inc. (Dr. Renata Volkov) — Environmental consultant (Phase I and Phase II ESAs)
• Brannigan Geotechnical Engineering, LLC (Neil Brannigan, PE) — Geotechnical consultant
• Kestrel Infrastructure Advisors, LLC (Diane Prescott) — Owner's representative
• Lumen Ridge Engineering, PLLC (Carlos Esteban, PE) — ALTA survey
• Greystone Appraisal Partners, LLC (Janet Choi, MAI) — MAI appraisals